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Mediaset SpA: Board approves results for First Quarter 2019

BOARD APPROVES RESULTS FOR FIRST QUARTER 2019:
SIGNIFICANT RISE IN PROFIT FOR THE PERIOD

Mediaset Group

Net revenues: EUR 718.2 million

Operating costs: down to EUR 496.9 million

Operating profit (EBIT): up to EUR 78.5 million

Net profit: rises to EUR 39.8 million

TV ratings: leadership in the commercial target in both Italy and Spain



The Board of Directors of Mediaset, which met today under the Chairmanship of Fedele Confalonieri, has approved the interim report for the first quarter of 2019.
The Group's performance in the first three months of 2019 saw a marked increase in the business reults, despite an advertising market that continues to be weak in both countries, Italy and Spain. Among the reasons for the positive performance in the main profitability indicators (operating profit/EBIT, net profit, cash generation) were the first positive effects of the digital transformation of the pay-TV offer in the second half of 2018.  

What follows is a summary of the main results for the first three months of 2019.


  • Net revenues came to EUR 718.2 million, compared with EUR 839.2 million in the first quarter of 2018. In particular, revenues in Italy amounted to EUR 492.1 million, compared with EUR 609.6 million in the same period of the previous year. In Spain revenues for the period came to EUR 226.1 million, compared to EUR 229.6 million in Q1 2018. Revenues in both countries were affected by a slowdown in the advertising market. In Italy, where the figures are not comparable with those of 2018, given that 2019 the advertising offer does not include the significant events, such as free and pay-TV coverage of the Italian Serie A and Champions League football championships, gross advertising revenues came to EUR 483.6 million, compared with EUR 505.8 million in the first quarter of 2018. On a comparable basis, according to Nielsen data for the period January-March 2019, the fall in Mediaset's advertising revenues was limited to -0.7%, compared with a fall in the TV advertising market of -2.7%. In Spain, meanwhile, advertising revenues came to EUR 223.7 million, compared with EUR 224.6 million for the same period of the previous year.

  • Total consolidated operating costs (labour costs, procurement, services and other charges, amortisations and depreciations of rights and other fixed assets) came to EUR 639.7 million, compared with EUR 810.5 million in Q1 2018. In Italy, in particular, there was a sharp fall in operating costs down to EUR 480.3 million from EUR 644.6 2018, (a remarkable reduction of -25.5%) mainly due to end of expensive football contracts for pay-TV which were still active at the beginning of last year. In Spain total operating costs (labour costs, other operating costs, amortisations and depreciations) came to EUR 159.5 million,  a marked drop compared with the same period of the previous year (EUR 166.0 million) thanks largely to optimisation policies in the content area.

  • The Group's EBIT for the period saw a significant increase, up to EUR 78.5 million, compared with EUR 28.7 million in the first quarter of 2018. In Italy EBIT amounted to EUR 11.9 million, compared with the loss of  -EUR 35,0 in the same period of 2018. In Spain the figure rose to EUR 66.6 million, compared with EUR 63.6 million in the first quarter of the previous year.

  • Net profit came to EUR 39.8 million, a marked increase on the with EUR 3.5 million of the same period of 2018.
  • Net debt was down again to EUR 791.9 million, compared with EUR 877.0 million at 31 December 2018 (the figure includes financial liabilities of EUR 140.6 million recorded at the time of the adoption of the new accounting method for operating lease contracts following the coming into force in 2019 of the IFRS 16 -Leases- accounting standard).
  • Free cash flow  for the period amounted to EUR 146.9 million, a significant increase compared with the EUR 9.5 million of the same period of 2018. During the period there was an outlay of EUR 49.5 million by the subsidiary Mediaset Espaņa SA for for the share buyback plan which foresees an overall outlay of not more than EUR 200 million.
  • TV ratings. In the first three months of 2019 Mediaset confirmed its net leadership in the commercial target, both in Italy and in Spain. In Italy, Mediaset is the leader in the commercial target of 15-64 year-olds in all time bands, with a peak of 34.2% share in prime time. Of note is the first place of Canale 5 and the third place of Italia 1 in the commercial target in all time bands. In Spain, the Mediaset Espaņa television channels maintained their absolute leadership in the 24-hours with a 27.9% share. Telecinco remained Spain's most popular channel in both the whole day (14.4%).


FORECAST FOR THE YEAR



At the moment, the trend in advertising sales in Italy in the second quarter, on a comparable basis (i.e. net of the effects deriving from the termination of  the pay-TV football offer and the contribution of the 2018 World Cup), are expected to remain in line with those of the first quarter.
In the same period, the Group's business results will continue to benefit from the impact of the digital transformation process of the Italian pay-TV activities, with a strengthening of the growth trend in the Group's margins and cash flow compared with 2018.



The executive responsible for the preparation of the Mediaset S.p.A. accounts, Luca Marconcini, declares that, as per para. 2 art. 154-bis, of the Single Finance Bill, that the accounting information contained in this press release corresponds to that contained in the company's books.

Cologno Monzese, May 14, 2019

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